FY08 RESULTS ANNOUNCEMENT PRESENTATION 4 MARCH 2009 · 2014-05-13 · FY08 RESULTS ANNOUNCEMENT PRESENTATION 4 MARCH 2009 . 1 DISCLAIMER ... possible or assumed future results of

0

FY08 RESULTS ANNOUNCEMENT PRESENTATION

4 MARCH 2009

1

DISCLAIMER

This presentation contains forward looking information, including statements which constitute forward looking statements within the

meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements are based on the current beliefs and

assumptions of our management and on information available to management only as of the date such statements were made.

Forward-looking statements include

(a) information concerning strategy, possible or assumed future results of our operations, earnings, industry conditions, demand and

pricing for our products and other aspects of our business, possible or future payment of dividends and share buy back program;

and

(b) statements that are preceded by, followed by or include the words “believes”, “expects”, “anticipates”, “intends”, “is confident”,

“plans”, “estimates”, “may”, “might”, “could”, “would”, and the negatives of such terms or similar expressions.

These statements are not guarantees of future performance and are subject to factors, risks and uncertainties that could cause the

assumptions and beliefs upon which the forwarding looking statements were based to substantially differ from the expectation

predicted herein. These factors, risks and uncertainties include, but are not limited to, changes in demand for the company’s

services, technological changes, the effects of competition, telecommunications sector conditions, changes in regulation and

economic conditions. Further, certain forward looking statements are based upon assumptions as to future events that may not

prove to be accurate. Therefore, actual outcomes and results may differ materially from the plans, strategy, objectives, expectations,

estimates and intentions expressed or implied in such forward-looking statements. Additionally, some of these statements refer to

board proposals to be submitted to ZON - Multimédia – Serviços de Telecomunicações e Multimédia, SGPS, S.A. (“Multimedia” or

“ZON”) AGM and subject to (i) its approval by Multimedia’s shareholders, (ii) the market conditions and (iii) the ZON’s financial and

accounting position as revealed in the financial statements approved by Multimedia’s AGM.

Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update them in light

of new information or future developments or to provide reasons why actual results may differ. You are cautioned not to place undue

reliance on any forward-looking statements.

ZON Multimedia is exempt from filing periodic reports with the United States Securities and Exchange Commission (“SEC”)

pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934, as amended. The SEC file number for PT Multimedia’s

exemption is No. 82-5059. Under this exemption, ZON Multimedia is required to post on its website English language translations,

versions or summaries of certain information that it has made or is required to make public in Portugal, has filed or is required to file

with the regulated market Eurolist by Euronext Lisbon or has distributed or is required to distribute to its security holders.

This presentation is not an offer to sell or a solicitation of an offer to buy any securities.

2

KEY HIGHLIGHTS

Total Operating Revenues

Revenues from Pay TV, Broadband and Voice

EBITDA

EBIT

Net Income

Δ % 2008/2007 2008 Consensus

776.6 Million Euros

244.5 Million Euros

100 Million Euros

47.9 Million Euros

+8.5%

+9.3%

+11%

+35%

(2.8)%

775 Million Euros

242 Million Euros

47 Million Euros

688.2 Million Euros n.a.

n.a.

2

3

KEY HIGHLIGHTS

RGUs

3P Customers

ARPU

Digital Subscribers

» 100 Thousand ZON BOXES installed

Record Broadband Growth

Record Voice Growth

Δ % 2008/2007 2008

+17.5%

+16.4 pp

+4.2%

+29.8%

+19.7%

3x

2834.3 thousand

23%

€32

495.8 thousand

479 thousand

327.1 thousand

3

4

I. Executing our Strategy Lead in 3Play

Deliver Excellence in Customer Service

Capture New Growth Opportunities

II. Delivering Results

5

6%

10%

14%

18%

23%

4Q07 1Q08 2Q08 3Q08 4Q08

ZON POSTED THE STRONGEST LIKE-FOR-LIKE GROWTH OF THE PAST 5 YEARS

1,561,61

1,68

1,75

1,85

4Q07 1Q08 2Q08 3Q08 4Q08

31,0

31,631,8

32,0

32,7

4Q07 1Q08 2Q08 3Q08 4Q08

2.413

2.515

2.608

2.690

2.834

4Q07 1Q08 2Q08 3Q08 4Q08

RGU [Total EOP - Thousands]

+17.5%

RGUs per Subscriber

+18.7%

Blended ARPU [Euros]

+5.6%

Triple Play Penetration [%]

+16.4pp


5

6

62%

32%

6%

Single Play Double Play Triple Play

47%

30%

23%

Single Play Double Play Triple Play

OVER 23% OF ZON CABLE CUSTOMERS ARE 3 PLAY

53% SUBSCRIBE TO 2 OR MORE SERVICES, COMPARED WITH 38% IN 2007

2008

PAY TV

APR 08

ZON 3

ZON BOX

PVR + HD

CAÇA

E PESCA

MAY 08 JUL 08

MOV HD

JUN 08

RTP HD

SPORT TV

AFRICA

AGO 08

TV CINE 4 HD

DISNEY

CINEMAGIC

OCT 08

EUROSPORT HD

SPORT TV HD

DISNEY CINEMAGIC HD

DEC 08

ZON BOX HD +

VOD

JAN 09

TVI24

FEB 09

ZON BOX

SATELLITE


SEP 08

2007

6

7

TV DIGITALIZED SERVICES (“FUNTASTIC”)

STRONG UPTAKE OF ZON BOXES IN JUST 2 QUARTERS

382400

417

446

496

4Q07 1Q08 2Q08 3Q08 4Q08

Digital Extended Basic Subscribers

[thousands]

26

18 17

29

50

4Q07 1Q08 2Q08 3Q08 4Q08

Digital Extended Basic Net Adds

[thousands]

24,7%25,6%

26,8%

29,0%

32,5%

4Q07 1Q08 2Q08 3Q08 4Q08

Digital Extended Basic Penetration of

Customer Base

[%]

53

91

3Q08 4Q08

ZON Box Subs QoQ

[thousands]

ZON Box Penetration of Customer Base

[%]

3,4%

6,0%

3Q08 4Q08

+29.8% +94.2%

+7.8 pp

+72.3% +2.5 pp


7

8

26,5%

40,4%

16,4%

16,7%

ZON PT SONAECOM OTHERS

BROADBAND GROWTH - STRONGEST OF PAST 5 YEARS

400416

431

451

479

4Q07 1Q08 2Q08 3Q08 4Q08

1316 15

20

28

4Q07 1Q08 2Q08 3Q08 4Q08

BROADBAND

Broadband Subscribers

[thousands]

Broadband Net Adds

[thousands]

Broadband Market Shares

[%]

Source: Anacom 4Q08

Statistic Report

+19.7% +117.1%

SPEED

UPGRADES

30 Mbps 100 Mbps 2 Mbps

€14.99

UNLIMITED

DOWNLOADS UPGRADE

EURODOCSIS 3.0

JAN 08

ZON 3

MAY 08 JUL 08 MAY 08 SEP 08 SEP 08 OCT 08 JAN 09 JAN 08

NET

ADSL

ZON@FON E-

ESCOLINHAS

ZON WAS THE BB OPERATOR THAT CAPTURED

MOST GROWTH IN MARKET SHARE IN 2008


28,9%

41,6%

12,5%

14,6%

2,4%

ZON PT SONAECOM OTHERS ZON ACQUISITIONS

2007

2008

8

9

2,5%

66,8%

20,9%

9,7%


10,5%

60,6%

18,1%

10,9%


200K CUSTOMERS

30

55

65

50

73

4Q07 1Q08 2Q08 3Q08 4Q08

VOICE – 327 THOUSAND CUSTOMERS ONLY 18 MONTHS AFTER LAUNCH

ACCELERATING GROWTH MOMENTUM WITH OVER 20 THOUSAND MONTHLY NET

ADDS IN 4Q08

VOICE

JAN 08

PORTABILITY

ZON 3

83

139

204

254

327

4Q07 1Q08 2Q08 3Q08 4Q08

Voice Subscribers

[thousands]

Voice Net Adds

[thousands]

Voice Market Shares

[%]

Source: Anacom 4Q08 Statistic Report,

Company Analysis

+291.8% +146.9%

JUN 08

UNLIMITED CALLS

MAY 08 NOV 08


2007

2008

9

10

1,56

1,61

1,68

1,75

1,85

6%

10%

14%

18%

23%

0%

5%

10%

15%

20%

25%

1,4

1,45

1,5

1,55

1,6

1,65

1,7

1,75

1,8

1,85

1,9

4Q07 1Q08 2Q08 3Q08 4Q08

31,0

31,631,8

32,0

32,7

4Q07 1Q08 2Q08 3Q08 4Q08

100%89,5%

42,1%52,6%

1P TV +

Internet

TV + Voice 3P

RGUs per Sub and Triple Play

Penetration

[units, %]

Blended ARPU

[euros]

Churn and Customer Profile

[%]

+18.7% +5.6%

Churn Reduction

ARPU growth

Increase in RGUs per Sub


10

11

68

30

819

20

9

26 9

85

37 342840

17 19 21

17

6

186

56

22

37

27

“ZON” LEADING BRAND AWARENESS 1 YEAR AFTER LAUNCH

(GfK BRAND AWARENESS SURVEY)

ZON leads in terms of brand awareness for Triple Play and Pay TV, and is well placed in Internet,

and Fixed Voice;

Key brand attributes were surveyed in areas such as service quality, concern for customer well-

being, innovation, good pricing.

Brand:

TV Publicity:

Other References

Other References

Top of Mind

Top of Mind

Triple Play Services TV Broadband Voice

Source: GFK


147

2820

6 2

19

6

22

8

16

3

32

13

50

27

23

5

4 3

76

1911 2

13

215

5

88

21

11

12

Improvement in problem solving ability

Faster service

Better rates of customer satisfaction

New customer care free access number

Higher worker satisfaction, leading to lower rate of turnover

Zon.pt’s customer area and myzon.pt were redesigned; selfcare contacts more than doubled and

by the end of 2008 myzon.pt had 274 thousand registered users

Decrease in the number of complaints received from Consumer Associations

I. Executing our Strategy Excelence in Customer Service + Operational Efficiency

12

13

I. Executing our Strategy Clear Improvement in Customer Service

SIGNIFICANT REDUCTION IN THE NUMBER OF CUSTOMER COMPLAINTS

0,270,21

0,07

0,05

0,11

0,08

0,45

0,34

2007 2008DECO PROTESTE CIAC

Number of Customer Complaints by 1000 services

[units]

(24.4)%

13

14

I. Executing our Strategy New Growth Opportunities

LAUNCH MVNO

• 7 Thousand Customers 4Q08

• Voice Only So Far

• Launch broadband + Homezoning 1H09

ACQUISITION TV TEL & PARFITEL COMPLETED SUCCESSFULLY

+ RGUs

+ TV

+ Broadband

+ Voice

147.9 Thousand

88.5 Thousand

40 Thousand

19.4 Thousand

POTENTIAL TO LEVER 3P SUCCESS + ACHIEVE SIGNIFICANT COST SYNERGIES

14

15

I. Executing our Strategy Exceeding Growth Targets

ACHIEVED 2008

TARGET

WHAT WE HAVE ALREADY ACHIEVED IN 1 YEAR OF ZON

RGU / sub

BROADBAND

VOICE

RGU

% 3PLAY

PAY TV ≈ 60

≈ 60

≈ 180

≈ 360

≈ 8 p.p.

≈ 0.2

66

119

263

569

17 pp

0.3

(22)

79

244

421

17 pp

0.3

With Acquisitions Without Acquisitions

15

16


17

61,8 63,7

2007 2008

715,7

776,6

2007 2008

629,5

688,2

2007 2008

REVENUE GROWTH

Operating Revenues

[millions of euros]

Pay TV, Broadband and Voice Revenues

[millions of euros]

+8.5%

+9.3%

II. Delivering Results Strongest Growth in the Market

Audiovisuals Revenues

[millions of euros]

+3.0%

46,249,2

2007 2008

Cinema Revenues

[millions of euros]

+6.6%

Note: the 2008 accounts include consolidation of acquisitions of TVTel and Parfitel operations as from November 2008; 17

18

15,414,7

2007 2008

168,3 171,1

2007 2008

221,9239,2

2007 2008

61,069,1

2007 2008

44,3

52,7

2007 2008

II. Delivering Results Margin Performance Supported by Cost Control

OPERATING COSTS GROWING ON THE BACK OF COMMERCIAL ACTIVITY,

BUT LESS THAN REVENUES

+19.1%

W&S

[millions of euros]

+7.8%

Direct Costs

[millions of euros]

+13.3%

Commercial Costs

[millions of euros]

+1.7%

Other Operating Costs

[millions of euros]

Average Monthly Costs per RGU

[euros]

(4.6)%


19

74,1

100,0

2007 2008

70,2

83,6

2007 2008

220,2244,5

2007 2008

30,8%31,5%

2007 2008

EBITDA

[millions of euros]

+11.0%

EBITDA Margin

[%]

+0.7pp

EBITDA - CAPEX

[millions of euros]

+19.0%


EBIT

[millions of euros]

+35.0%


20

-3,0%

-16,5%

-6,0%

11,0%

FINANCIAL PERFORMANCE 2008

Revenue Growth of 8.5% yoy

EBITDA Growth of 11% yoy

OUTPERFORMING PEERS IN A TOUGHER COMPETITIVE ENVIRONMENT

Source: Company Reports, ZON Analysis

Revenue Growth EBITDA Growth

Wireline

Wireline excl PRB

(9M08) (9M08)

9,0%

-1,6%

8,5%

Wireline


Note: ZON’s 2008 accounts include consolidation of acquisitions of TVTel and Parfitel operations as from November 2008; 20

21

49,347,9

2007 2008

II. Delivering Results Net Results

INFLUENCED BY HIGHER D&A, FINANCIAL CHARGES, IMPAIRMENT FROM

ACQUISITIONS

Net Income

[millions of euros]

(2.8)%

NET RESULTS BEFORE IMPAIRMENT CHARGE IN 4Q08

WOULD HAVE INCREASED BY 1.5% TO 50.1 MILLION EUROS

NET FINANCIAL EXPENSES INCREASED BY 22.2 MILLION EUROS

TO 25.9 MILLION EUROS LED BY HIGHER AVERAGE GROSS DEBT AND HIGHER INTEREST RATE ENVIRONMENT

DEPRECIATION INCREASED 15% TO 140.4 MILLION EUROS

DRIVEN BY HIGHER INVESTMENT IN TERMINAL EQUIPMENT AND LONG TERM CONTRACTS

TOTAL NET RESULTS OF 47.9 MILLION EUROS


22

99,4

145,5

50,6

15,4150,0

160,8

2007 2008

"Baseline" CAPEX Non-Recurrent CAPEX

14,3

53,116,6

16,468,5

76,099,4

145,5

2007 2008

Terminal Equipment Other Pay TV, Broadband and Voice Infrastructure

II. Delivering Results Strong Commercial Activity Leading to Higher CAPEX

+46.4%

Baseline CAPEX

[millions of euros]

+7.2%

Total CAPEX

[millions of euros]

Note: The 2008 accounts include consolidation of acquisitions of TVTel and Parfitel operations as from November 2008; 22

23

23,5

59,0

83,6

89,6

148,2

153,2

119,9

28,9

13,8

552,5

2007

Working Capital

EBITDA - CAPEX

Acq of Own Shares

Acq of Fin Investments

Dividends

Long Term Contracts

Acquisitions' Debt

Other items

2008

II. Delivering Results Strong Growth

SUPPORTED BY SOUND CAPITAL STRUCTURE & ADEQUATE DEBT MATURITY

0,1

2,3

2007

2008

Net Financial Debt

[millions of euros]

Net Financial Debt / EBITDA

[x]


24

II. Delivering Results Commitment to Shareholder Remuneration

PROPOSAL TO DISTRIBUTE 16 CENTS PER SHARE, REPRESENTING A CLOSE

TO 100% PAYOUT RATIO, CLEARLY AT A PREMIUM TO PEER GROUP, TO BE

APPROVED BY THE GENERAL SHAREHOLDERS MEETING ON 28 APRIL

4,4%3,9%

2,7%

0% 0%

3,8%

2,1%

1,2%

0% 0%

ZO

N

Tele

ne

t

VM

ED

MM

P

LG

I

Ro

ge

rs

Co

mca

st

Ca

ble

vis

ion

TW

C

Me

dia

co

m

Dividend Yield (1)

[%]

100%

0%

49%

0% 0%

54%

26% 29%

0% 0%

ZO

N

Tele

ne

t

VM

ED

MM

P

LG

I

Ro

ge

rs

Co

mca

st

Ca

ble

vis

ion

TW

C

Me

dia

co

m

Payout Ratio

[%]

(1) Defined as cash dividend per share divided by current share price.

Source: Broker Consensus 24

25

Operating Revenues

EBITDA (1)

EBITDA margin

Operating Profit (EBIT) (2)

Net Income

“Baseline” CAPEX

Earnings Per Share (Euro Cent)

Net Financial Debt


Financial Highlights

[millions of euros]

715.7

30.8%

74.1

49.3

99.4

776.6

244.5

31.5%

100.0

47.9

145.5

8.5%

0.7 pp

46.4%

2007 2008 Δ % Y.o.Y.

11.0%

35.0%

(2.8)%

220.2

15.96

23.5

16.26

552.5

1.9%

n.a.

(1) EBITDA = Income From Operations + Depreciation and Amortization;

(2) EBIT = Income Before Financials and Income Taxes


Documents

FY08 RESULTS ANNOUNCEMENT PRESENTATION 4 MARCH 2009 · 2014-05-13 · FY08 RESULTS ANNOUNCEMENT PRESENTATION 4 MARCH 2009 . 1 DISCLAIMER ... possible or assumed future results of